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Monday, May 10, 2010

State budget cuts reduce county funds

---Here is what's going on in *my* state and it's counties... I'm sure the story is the same across the country... Where, when and how will it all end? Revenues obviously are NOT coming back any time soon!

County officials are bracing for more state budget cuts to translate into a loss of county revenues.

In an effort to balance Missouri’s budget, the state earlier this year cut the amount it reimburses county assessors for work to determine property values. The budget approved by lawmakers for fiscal 2011 calls for cutting the amount the state reimburses counties to house prisoners bound for state lockup.

County officials, who have protested the cuts to state legislators, are concerned that there could be more to come, said John Bartosh, Jasper County presiding commissioner.

“Aside from holding down spending, we can’t really be proactive because we don’t know what’s next,” he said.

Lawmakers late last month approved a 2011 operating budget that makes cuts throughout state government. It trims spending on higher education, mental health and tourism, and keeps K-12 education spending flat — even though a state formula for basic aid to schools called for an increase of more than $100 million.

More than $484 million has been cut from the initial budget proposed by Gov. Jay Nixon, and Nixon’s budget director has warned that more spending reductions might be necessary. The budget takes effect July 1.

Cut or tax

The cuts put county officials in the position of either finding ways to reduce spending or asking taxpayers to make up the loss, said Dick Burke, executive director of the Missouri Association of Counties.

“No one wants to do that (seek a tax increase), especially now,” he said. “So when the state doesn’t fund an idea, the county either has to come up with the money or something is not going to be funded. They are extremely frustrated that this has been put on their backs.”

Cuts in the state reimbursement to counties for property assessments came in January as a result of action by the governor. The reimbursement amount was trimmed to $4 per parcel, down from the $6 budgeted by lawmakers.

For Jasper County, the cut reduced revenues in the assessor’s budget by $115,000, said Richard Webster, county auditor and budget officer.

“We were able to change this year’s budget to base it on the $4 amount,” he said. “There was a rumor flying they would cut it even more; that’s really concerning.”

Newton County lost about $58,000 in the state reimbursement for property valuations.

Prisoner reimbursement

The state budget calls for a cut in the reimbursement rate for housing state prisoners in local jails from $22 per day to $19.58.

For Jasper County, that will amount to about $82,500 in revenue cuts, said Webster.

“It’s been $22 for quite a while, but counties are always asking for more,” he said. “Our average cost for housing prisoners is $45 per day.”

Newton County expects to take “a bigger hit” on prisoner reimbursements, said Jerry Black, an associate commissioner. Despite that, Black said he believes counties will be able to ride out the financial downturn more easily than the state.

“The state is in much worse shape than counties like ours,” he said. “Our revenue is based on sales tax, but the state’s is also based on income tax. When people aren’t working, they’re not paying income tax.”

Reserve funds

Jasper County currently has general fund reserves of more than $1.5 million, compared with $1.4 million a year ago, Webster said.

“We’re asking everyone to hold down spending, but it can’t last, because we’re reaching a point in the year where we normally have to spend more than we take in,” he said.

Newton County has general fund reserves of $1.8 million, down from $2.2 million at the start of the year, Black said.

“We’ve had to do some construction projects, but we’re being very judicious,” he said. “Our revenue from sales tax is down about $400,000, but hopefully collections will start getting a little better. We can’t generate other revenue without raising taxes, so all we can do is try to cut costs.”

Across the board

When it becomes necessary, it will take spending cutbacks “across the board” to offset the revenue loss from the state cuts, Webster said.

“We can’t cut the budget, so we’ll say, ‘Please don’t spend,’” he said. “That’s going to be harder in departments that have small budgets, because there are certain expenses that have to be paid.”

Pay raises for county workers were not part of this year’s budget in Jasper and Newton counties. Pay hikes also weren’t authorized for Jasper County workers the year before.

State lawmakers have proposed a measure that would allow counties to make midyear budget cuts, and Bartosh said he hopes the proposal becomes law.

State lawmakers also are looking to balance the state budget by giving local law enforcement more responsibilities in enforcing state alcohol and tobacco laws, while state officials would focus more on licensing.

Ken Copeland, Newton County sheriff, said that will have no effect on his department, which already enforces alcohol rules.

“Around here, police take care of that in the cities, and the sheriff’s department in the county,” he said.

Copeland said the budgets of sheriff departments and counties would be hard hit if lawmakers adopt another proposal.

Now, prison sentences of up to a year are served in county jails, and those with longer sentences go to the Missouri Department of Corrections. A bill proposed this session calls for sentences of three years or less to be served in county jails.

“That would greatly impact us and overcrowd every county jail in the state,” he said. “It hasn’t been passed, and the (Missouri) Sheriffs’ Association is fighting it.”

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